Monday, May 3, 1999
AUSTIN - Texas Attorney General John Cornyn today announced a $445,000 judgement against two Houston non-profit groups, the American County Officers Association, Inc. (ACOA) and Volunteer Fire Fighter Association, Inc. (VFFA), which were allegedly organized to solicit donations for law enforcement and fire fighter charities. In fact, these charities received a negligible amount of the donated funds while the operators took hundreds of thousands of dollars.
"Generous Texans gave from their hard earned paychecks, and these telemarketers abused this goodwill for their own gain," said General Cornyn.
As a result of complaints from businesses regarding the use of harassing and deceptive telephone solicitation practices, the state initiated an investigation and filed suit on March 25, 1999. The State obtained a Temporary Restraining Order and Asset Freeze against ACOA and VFFA and their principals, Eric W. Goodman, Marta M. Goodman and Robert C. Johnson.
The investigation revealed that approximately 1 million dollars in contributions were given by generous consumers to ACOA and VFFA. The donors were led to believe they were assisting their local law enforcement officers and volunteer fire fighters with new equipment, services and benefits. In fact, less than one per cent was utilized for a charitable purpose. A majority of the contributions collected from the public were used for the personal gain of the individual defendants and their telemarketers.
"These groups deliberately cheated not only generous people out of their money but also law enforcement and fire fighters out of the services they deserve," said Harris County Sheriff Tommy Thomas.
The judgment requires the dissolution of both non-profit corporations, ACOA and VFFA. The judgment prohibits the defendants from owning or operating any non-profit or for-profit entity that solicits funds from Texas residents or businesses whether it is based in Texas or another location. The terms of the judgment include the payment of $445,000 for the forfeiture of illegal profits, civil fines and penalties, and attorneys fees.
This case was handled by Assistant Attorneys General Laurie Cook of the Charitable Trust Division and John Owens of the Houston Office of the Consumer Protection Division.
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